Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2013

Summary of Significant Accounting Policies [Abstract]

Historical percentages of chargeback

Set forth below are the Company’s historical estimates of the percentage of sales that are subject to chargebacks that were used during each quarterly period in the three years ended December 31, 2013:

Year	Q1	Q2	Q3	Q4
2013	90.0%	90.0%	90.0%	90.0%
2012	98.5%	98.5%	95.0%	90.0%
2011	98.5%	98.5%	98.5%	98.5%

Changes in goodwill

Changes in goodwill during the two years ended December 31, 2013 were as follows (in thousands):

	Goodwill
December 31, 2011	$	11,863
Acquisitions		22,613
Impairments	-
Foreign currency translation		(2,317	)
December 31, 2012	$	32,159
Acquisitions	-
Impairments	-
Foreign currency translation		(2,328	)
December 31, 2013	$	29,831

Major categories of intangible assets and weighted-average remaining amortization period

The following table sets forth the major categories of the Company’s intangible assets and the weighted-average remaining amortization period as of December 31, 2013 for those assets that are not already fully amortized (dollar amounts in thousands):

	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Weighted Average Remaining Amortization Period
Product licensing rights	$	151,504	$	(35,604	)	$	115,900	9.8 years
Trademarks		9,500		(844	)		8,656	27.4 years
Customer relationships		6,166		(1,528	)		4,638	9.8 years
Non-Compete		2,428		(1,117	)		1,311	2.2 years
	$	169,598	$	(39,093	)	$	130,505

Changes in intangible assets

Changes in intangible assets during the two years ended December 31, 2013 were as follows (in thousands):

	Product licensing rights			Trademarks			Customer Relationships			Non-Compete Agreements
December 31, 2011	$	67,822			$9,289		$	3,727		$	-
Acquisitions		1,100			-			2,560			2,743
Amortization		(5,268	)		(317	)		(705	)		(580	)
Foreign currency translation	-			-				6			8
December 31, 2012	$	63,654		$	8,972		$	5,588		$	2,171
Acquisitions		57,969		-			-			-
Amortization		(5,723	)		(316	)		(740	)		(643	)
Foreign currency translation	-			-				(210	)		(217	)
December 31, 2013	$	115,900		$	8,656		$	4,638		$	1,311

Amortization expense of acquired intangible assets

The amortization expense of acquired intangible assets for each of the following five years will be as follows (in thousands):

Year ending December 31,	Amortization Expense
2014	$	15,996
2015		15,388
2016		14,862
2017		14,345
2018		14,262

Average estimated useful lives of property, plant and equipment

The following table sets forth the average estimated useful lives of the Company’s property, plant and equipment, by asset category:

Asset category	Depreciable Life
Buildings	30 years
Leasehold improvements	18 years
Furniture and equipment	10 years
Automobiles	5 years
Computer hardware and software	5 years

Summary used to measure fair values of financial instruments

The following table summarizes the basis used to measure the fair values of the company’s financial instruments (amounts in thousands):

			Fair Value Measurements at Reporting Date, Using:
			Quoted Prices		Significant
			in Active		Other		Significant
			Markets for		Observable		Unobservable
	December 31,		Identical Items		Inputs		Inputs
Description	2013		(Level 1)		(Level 2)		(Level 3)
Cash and cash equivalents	$	34,178	$	34,178	$	-	$	-
Foreign currency forward contracts		208		-		208		-
Total assets	$	34,386	$	34,178	$	208	$	-
Purchase consideration payable	$	14,728	$	-	$	-	$	14,728
Total liabilities	$	14,728	$	-	$	-	$	14,728

			Quoted Prices		Significant
			in Active		Other		Significant
			Markets for		Observable		Unobservable
	December 31,		Identical Items		Inputs		Inputs
Description	2012		(Level 1)		(Level 2)		(Level 3)
Cash and cash equivalents	$	40,781	$	40,781	$	-	$	-
Total assets	$	40,781	$	40,781	$	-	$	-
Purchase consideration payable	$	14,208	$	-	$	-	$	14,208
Total liabilities	$	14,208	$	-	$	-	$	14,208

Assumptions used in estimating fair value of warrants

The assumptions used in estimating the fair value of the warrants at June 28, 2010 were as follows:

Expected Volatility	79.7%
Expected Life (in years)	3.8 – 4.1
Risk-free interest rate	1.8%
Dividend yield	-

Warrants

The following table provides summarized information about the Kapoor Warrants as of December 31, 2013:

Granted To:	Grant Date	Warrants Granted		Exercise Price		Book Value ($000s)
EJ Funds	Apr.13, 2009		1,939,639	$	1.11	$	4,829
Kapoor Trust	Apr.13, 2009		1,501,933	$	1.11		3,740
EJ Funds	Aug.17, 2009		1,650,806	$	1.16		4,127
Kapoor Trust	Aug.17, 2009		2,099,935	$	1.16		5,250
			7,192,313			$	17,946